Partnership for Indonesia’s Sustainable Agriculture Indonesia ......Tempo Inti Media, Tbk The...

PISAgro | 1Grow Asia: Indonesia

IndonesiaPartnership for Indonesia’s Sustainable AgricultureSupported by Grow Asia2018


Partnership for Indonesia’s Sustainable AgricultureThe Partnership for Indonesia’s Sustainable Agriculture (PISAgro) was first announced by the Vice Minister of Agriculture and Vice Minister of Trade during the World Economic Forum on East Asia in Jakarta, in June 2011.

Officially established on 20 April 2012, PISAgro is a public-private partnership that was created in response to challenges and opportunities facing the agriculture sector in Indonesia. Through its “Vision 20-20-20” which aims to increase farm yields by 20%, reduce poverty by 20%

Continuing to engage the government to align priorities and develop synergies with the national agenda

Scaling existing projects through broader participation from global and local partner organizations

Strengthening the partnership platform to deliver greater value to members and partners

Key strategic focuses for the year ahead:

and reduce greenhouse gas emissions by 20%, the partnership seeks to provide an innovative, multi-stakeholder model for addressing the nation’s agricultural challenges in a sustainable manner while improving the livelihoods of smallholder farmers.

PISAgro now has more than 70 partners, consisting of national and multinational companies, NGOs, donors and other institutions across its 12 Working Groups focused on 10 crops and commodities, and 2 cross-cutting themes.

Focus Area 1

Focus Area 2

Focus Area 3


Franky Widjaja Dharnesh GordhonChairman & CEO Sinar Mas Agribusiness and Food

President Director Nestlé Indonesia

Sustainability can only be achieved when there is a balance between economic opportunity, environmental protection and social welfare. PISAgro’s Working Groups are designing and implementing “closed loop” systems that integrate these important elements for stakeholders to deliver results, best practices, and scale up value chain initiatives together.

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PISAgro’s progress proves that the multi-stakeholder model is a productive way to tackle the major challenges facing Indonesia’s smallholder famers and the agricultural industry at large. Together with other private-public partners, PISAgro has a unique role in achieving national efforts for food security and transforming agriculture from subsistence to entrepreneurship.

267

Population Population below the poverty line

Population in agricultural employment

Agricultural contribution to national GDP

Agricultural land

Rural population

Mobile penetration Females employed in agriculture

million31% 14%11%

570,000 46% 21% 29% km2


PISAgro Governance and Structure

Founders Committee

Agri-Finance

Corn

Potato

Beef

Dairy

Rubber

Cocoa

Horticulture

Soy Bean

Coffee

Palm Oil

Vocational Training

Advisors Board Secretariat

Sinar MasNestlé IndonesiaIndofoodUnilever Indonesia Bayer Indonesia Syngenta Indonesia McKinsey & Company Indonesia

Ministry of Agriculture Ministry of Trade Ministry of Finance Tempo Inti Media, TbkThe Jakarta Post

Sinar MasNestlé IndonesiaIndofoodUnilever Indonesia Bayer IndonesiaSyngenta IndonesiaMcKinsey & Company Indonesia IDHTriputra Agro PersadaCargill IndonesiaGrow Asia

Executive DirectorCommunications ManagerOffice Manager

Working Groups

$


Organizing an innovative value chain event showcasing various Working Group project schemes

Consulting and advising commodity Working Groups on their agri-finance schemes Advising relevant ministerial offices on adjusting the subsidized farmer lending program to be available for more crops

Agri-Finance

Activities

$


Beef

Developing financial schemes for smallholder farmers

Helping farmers increase productivity by providing them with knowledge about best practices

Providing high quality animal feed to optimize weight gain

26 farmers engaged

Activities

Impact


23%

Cocoa

Impact

136,877 13,540

62%

66%

1.09 0.77

Delivering professional farmer packages, such as agri-inputs, planting material, and knowledge

Improving access to savings, loans, other financial services, and financial literacy trainings

Increasing awareness of environmental issues in the cocoa sector by educating and training farmers in environmentally-friendly practices

Building training programs to improve communities’ access to nutrition and other basic services

Promoting the inclusivity of marginalized groups like women and youths

Launching CocoaTrace, a cloud-based software to enable the industry to trace cocoa beans from the farm to the processing facility

farmers engaged, of which

are women

increase in baseline yield

increase in baseline income

GHG reduction by from

to tCO2e/MT

Activities


Coffee

Activities

Developing a replanting program with better plant material that increases productivity and adaptability to climate change

Organizing trainings for farmers to qualify for Common Codes for Coffee Community (4C)

Creating shorter and transparent supply chain aggregators (KUB) to export markets

Developing a financial ecosystem, and providing loans for inputs

Piloting mobile banking and cashless transactions for farmers

Teaching program on income diversification through intercropping and “Farmers Business School”

Impact

19,227

Mobile bank accounts

farmers engaged

43% increase in baseline yield

17,000 farmersopened for

204% increase in baseline income

$ $

$


Activities

10%increase in baseline yield

45% increase in baseline income

Corn

Providing bundled services of agricultural inputs, Good Agricultural Practices (GAP), micro loans, financial literacy, digital payments, crop insurance and market access in West Nusa Tenggara and South Sulawesi Provinces

Improving farmers’ access to credit loans, corn seeds, and training

Improving farmers’ access to hybrid corn in Madura, East Java to increase productivity

Impact

9,020 farmers engaged, of which

are women644


25,000

are women50%farmers engaged, of which

Dairy

Activities

Developing models for transforming Indonesia’s smallholder dairy farming sector through improved productivity, farmer incomes and increased milk production to reduce imports

Establishing model farms to demonstrate sustainable and profitable smallholder dairy farming

Impact

Promoting and facilitating fodder farming, nursery and distribution of better plant materials, maize farming for fodder, and development of various legumes

Collaborating with cooperatives to establish and manage rearing farms

Financing models for farmers to scale up from 3-4 cows currently, to 8 productive cows

20model farms

10,000 water-ad-libitum systems installed in barns

8,000 farmhouses with biogas systems

Over


Horticulture

Activities

Growing papaya, guava and banana

Optimizing farmers’ production techniques

Providing high quality seeds and supervising cultivation

Giving off-take guarantees

Facilitating the availability of early flowering technology, which provides mango farmers with a longer harvest, produces higher quality fruit, and achieves better prices in the off-season

Gunung Sewu Group Initiative: Syngenta Indonesia Initiative:

Impact

251farmers engaged over

hectares of land under Gunung Sewu’s projects

380

1,713 farmers reached under the Syngenta’s mango project


Palm Oil

Activities

Developing an innovative financing scheme for replanting for smallholder palm oil farmers, including farmers’ living expenses as part of the financing package

Ensuring the implementation of GAP

Organizing farmers into cooperatives

Training and guiding farmers to implement GAP

Supporting farmers in getting short term loans for high quality fertilizers and herbicides

Sinar Mas Initiative:

Triputra Agro Persada and Sinar Mas Program:

hectares of land covered

Impact

40,180 93,377 farmers engaged


Developing PalmOilTrace Web and Mobile applications for online-offline data collection, data evaluation, and KPI reporting

Deployment of up to 90 Koltiva Field Agents for data collection from mills, agents, smallholder households, and polygon mapping of smallholder plantations

Establishing Traceability Support Service with Mills and Agents for data input in PalmOilTrace Traceability modules for every single FFB Transaction from smallholder plantation to the mill

Developing supply shed model and traceability capabilities

Providing training and support to improve farming practices

Providing advisory and guidance to farmers

Organizing farmers into effective cooperatives

Helping farmers become certified under the RSPO and ISPO certification guidelines

Koltiva Smallholder and Traceability Mapping:

Indoagri-IDH Project:


Producing high quality industrial potato seeds

Developing the cultivation in Sumatra Island

Facilitating access to capital

Enhancing farmers’ capacity, building on GAP through mentoring and mechanization

Potato

Activities

$$

$

71% increase in incomes

Impact

4,300 farmers engaged


Rubber

Activities

Conducting trainings for trainers to multiply farmer champions/model farmers

Providing technical training and field assistance to improve farmers’ productivity

Replanting project for farmers

Integrating database of Smallholders Management System

Organizing tapping competitions and the GAP Quiz (Kelompencapir)


30%increase in productivity

Impact


Soy Bean

Activities

Conducting cross-learning activities among soy bean farmers in participating regions

Training of trainers on Sustainable Agricultural Practices

Close assistance in self-assessment process for smallholders and farmer cooperatives to attain sustainable certification

Connecting smallholders to better inputs, financial assistance and markets

Providing cooperatives development program in financial management, organization, and social entrepreneurship

Impact


52% increase in baseline yield

51% increase in baseline income$ $


Vocational Training

Activities Activities

Organizing a three-month modern farming practice training to Vocational High School (SMKs) students in rice farming in Wapeko

Providing land, facilities, boarding rooms and accommodation to students

Teaching GAP modules on rice farming, agriculture mechanization, and financial literacy: farming as business

Providing a two-year apprenticeship to university students majoring in agriculture with a mentorship program

Providing students with accommodation and opportunities for practical application

Supporting students with good results with an offer to work for PT Triputra Agro Persada

Bayer Indonesia’s Project in Merauke, Papua Province:

Triputra Agro Persada (TAP) Project in South Kalimantan Province:

students engaged across2 projects

Impact

73increase in baseline income


Multi-stakeholder partnership platform Grow Asia connects like-minded partners in Indonesia’s dairy industry to share knowledge

More than 25,000 dairy farmers across 41 milk cooperatives sell approximately 500,000 liters of fresh cow milk to Nestlé’s factory in Kejayan, East Java. The PISAgro Dairy collaboration ensures continued supply of high quality raw materials for production needs, while opening access to markets and providing the various support needed to improve farmers’ welfare.

Partnering with Indonesia’s dairy farmers to transform the supply chain

Indonesia Dairy

Partnership for Indonesia Sustainable Agriculture (PISAgro) Improving the milk supply chain and strengthening farmers’ capacity

• Introduced the Dairy Working Group’s lead, Nestlé Indonesia, to other actors in the region to increase the group’s impact

• Sharing knowledge from global experience and developing guidelines for performance measurement

• Capturing and disseminating knowledge and best practices from Nestlé’s value chain initiative

• Developing models for transforming Indonesia’s smallholder dairy farming sector through improved productivity, farmer incomes and increased milk production to reduce imports

• Establishing model farms to demonstrate sustainable and profitable smallholder dairy farming

• Promoting and facilitating fodder farming, nursery and distribution of better plant materials, maize farming for fodder, and development of various legumes

• Collaborating with cooperatives to establish and manage rearing farms

• Financing models for farmers to scale up from 3-4 cows to 8 productive cows

National tri-sector behavior and collaborationContributing to the country’s goal of attaining food security and alleviating poverty

• Presented a White Paper to relevant government ministries to transform Indonesia’s dairy smallholders

• Provided inputs to National Dairy Roadmap to reduce reliance on imports

• Aligning with other national platforms such as KADIN

• Promoting the importance of access to finance for smallholders through subsidies and Kredit Usaha Rakyat


Smallholder Impact

A comprehensive approach to community development

farmers have increased their milk production to 14 litres/day/cow

farmers engaged of which 50% are women

hectares planted with high protein “odot” grass

farmers who recycle slurry to use as fertilizer on fodder farms

model farms constructed

farmhouses with biogas systems, providing gas for household needs while reducing greenhouse gas emissions equivalent to 28,000 cows

water ad-libitum systems installed in barns

Over

Over

4,500 25,000

600

300

208,000

10,000

Indonesia’s dairy industry has seen market demand rising more than 10% annually over the past decade due to changing consumer habits and population growth. Indonesia’s estimated per capita milk consumption is only 11.7 liters per annum, which is significantly lower than the 22 liters consumer per capita in the Philippines and 31 liters in Thailand.

On the production side, the majority of Indonesia’s dairy farms are small with just two to three cows. These production units are characteristically inefficient, with low productivity and profitability. On average, milk yield is less than 10 liters per animal per day, and calving intervals are between 18 and 20 months. If the price of beef is reasonable, these smallholders often prefer to sell their cows for beef slaughter rather than maintain them for milk production. Only 23% of the raw materials for milk supply are produced locally with the balance met by foreign imports.

Led by the Ministry of Agriculture, several Indonesian Ministries have plans to boost dairy production. All these plans recognize the need to enhance dairy genetics through live dairy heifer imports. The government also continues to encourage domestic milk processing industries to further increase their commitment to invest, especially with the development of integrated dairy cattle farms to reduce dependence on imported milk raw materials.

About Indonesia’s Dairy Industry

This model of collaboration has allowed us to ensure that Nestlé receives high quality raw materials supplies from dairy farmers, and at the same time, dairy farmers gain access to market and earn the necessary support to help improve their welfare.

One of the challenges in the national dairy industry today is how local dairy farms can meet the growing demand for milk in Indonesia. Although milk production in Pujon continues to increase, the demand for milk in Indonesia is still largely met by imported raw materials. Therefore, the Department wishes to boost the population of dairy cows in order to help boost milk production.

Thanks to the collaboration program from Nestlé and SAE Pujon Cooperative, I gained more knowledge about good dairy farming practices. I also use a biogas dome at home, which makes my home and its surrounding cleaner, my family healthier and our spending less. Now, I have 12 cows with an average milk production of more than 1,800 liters per month, and with the income from dairy farming, I have managed to pay for my child’s tuition for undergraduate level in the university.

Our collaboration with Nestlé has enabled continuous innovation in order to jointly face the challenges and development in dairy farming. It is very important for us since most of Pujon’s community depends on the dairy industry for a living.

Wisman DjajaSustainability Agriculture Development & Procurement Director, PT Nestlé Indonesia

Ir. SudjonoHead of the Department of Animal Husbandry and Animal Health, Malang Regency

Mr. HariyantoDairy Farmer

Abdi SuwasonoChairman of SAE Pujon Cooperative

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• International Finance Corporation (IFC)• Rabobank Indonesia• IDH• Mercy Corps Indonesia• Swisscontact• DFAT (AIP-PRISMA)• Bank Rakyat Indonesia (BRI)• Bank Andara• Bank Negara Indonesia (BNI)• Swiss-Re

• KIBIF

• Swisscontact• Nestlé Indonesia• Cargill Indonesia• UTZ• Koltiva• Yara Indonesia• Indonesian Coffee and Cocoa Research Institute (ICCRI)• SECO-Switzerland• MCA-Indonesia• 3 financial institutions and 6 leading cocoa supply chain companies• 11 Provincial Governments• 57 District Governments

• Nestlé Indonesia• IDH• Yara Indonesia• ICCRI• Rabobank Foundation• Bank BTPN• Telkomsel• Rainforest Alliance

• DFAT (AIP-PRISMA)• Syngenta Indonesia• Cargill Indonesia• Mercy Corps Indonesia• Bank OK Indonesia• Directorate General of Food Crops, Ministry of Agriculture• ACA Asuransi• Coordinating Ministry of Economic Affairs• 8villages• BPR Pesisir Akbar

• Nestlé Indonesia• Brawijaya University• CSIRO• Milk Cooperatives• Bank BTPN

• Sinar Mas• IDH• LDC Indonesia• Rabobank Indonesia• Triputra Agro Persada• Koltiva• Yara Indonesia• Indofood Agri• Tiga Pilar Sejahtera Food• BRI Agro• Directorate General of Plantation, Ministry of Agriculture• PT Perkebunan Nusantara III• Indonesian Palm Oil Association (GAPKI)• SPKS (Palm Oil Smallholders Union)

• Great Giant Pineapple• Syngenta Indonesia• DFAT (AIP-PRISMA)• East West Seed Indonesia• PT Suryonusa Agromakmur• University of Mataram• Directorate General of Horticulture-Ministry of Agriculture• Assessment Institute of Agriculture Technology of West Nusa Tenggara & East Java• Provincial Government of West Nusa Tenggara & East Java• Local mango collectors

PartnersAgri-Finance

Beef

Cocoa

Coffee

Corn

Dairy

Palm Oil

Horticulture


• Indofood• Yara Indonesia• Directorate General of Horticulture, Ministry of Agriculture• Sarana Tani

• Kirana Megatara• Pirelli• Michelin• Sregrip GIZ• GoodYear• Conservation International• SNV• Bogor Institute of Agriculture• Bank BTPN

• Unilever Indonesia• Nestlé Indonesia• Indofood• Syngenta Indonesia• Indonesian Bureau of Logistics (BULOG)• Bank Negara Indonesia (BNI)• University of Gajah Mada• Directorate General of Legumes and Tuber Crops, Ministry of Agriculture• GAKOPTINDO

• Bayer Indonesia• Medco• Kubota• International Finance Corporation (IFC) • Five Vocational High School (SMKs) in Merauke Regency, Papua• Regional government of Merauke Regency• Ministry of Education• PT Triputra Agro Persada • Instiper, DI Yogyakarta• STIPAP Medan• LPP Yogyakarta

Potato

Rubber

Soy Bean

Vocational Training


Proudly supported by:

Board of Patrons:


Z Martini IndrawatiExecutive Director, [email protected]

T +62 21 5047 8888F +62 21 5043 8888

Sinar Mas Land Plaza Tower 17th Floor, Jl. MH. Thamrin Kav. 51, Jakarta 10350, Indonesia

Pranav SethaputraManager, [email protected]

PISAgro [email protected]

Contactwww.pisagro.org

@PISAgro

@PISAgro

@WEFPISAgro

Engage

mailto:martini%40pisagro.org?subject=

mailto:pranav%40growasia.org?subject=

mailto:contact%40pisagro.org?subject=

http://www.pisagro.org

https://twitter.com/PISAgro

https://www.youtube.com/channel/UCYHKOuhvCeC1ii0wdHokJlQ

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